Although the corona pandemic is currently presenting the global community with immense challenges, environmental and climate protection remain high on our agenda. Because the health of our children and grandchildren is closely linked to the health of our environment.
With the climate package, the Federal Government set the course last year for Germany to phase out coal-based electricity and make immense investments in new, environmentally friendly technologies and become climate-neutral on this basis. The economic stimulus program that has just been adopted follows this compass by relying on the promotion of renewable energies, e-mobility and green hydrogen.
In transport and energy policy, the link to climate issues is obvious. However, environmental and health issues are rarely considered when it comes to fiscal policy – that is a mistake.
Because the finance industry is an important factor in setting the course for a future worth living: Directing money into sustainable, climate-friendly investments is a decision that is as wise as it is trend-setting. It is about enforcing social standards and using the economic opportunities of ecologically necessary change.
Sustainable investments are becoming increasingly important in order to achieve real progress in environmental and climate protection. Institutional and private investors can only invest sustainably if companies first operate sustainably and, secondly, this is transparent and assessable for the financial industry.
Many have already recognized this, including the state as an investor in the capital market. The federal government is implementing clear sustainability principles with the state development bank KfW and the fund for financing nuclear waste disposal.
Banks are also becoming greener
Local banks are also reacting to this trend and are increasingly moving to align their loan and investment portfolios with the goals of the Paris climate agreement. The German financial sector is thus taking up the challenge of the climate crisis. This is a strong signal that will not fail to have an impact on the economy.
As a government, we stand by our responsibility. The first ecologically sustainable federal bond is expected to be issued soon.
It will be issued in September and is expected to set a new international standard. Federal securities form the interest rate benchmark in the euro area. We want to build on this and make a substantial contribution in the new ecological market segment. The federal government is investing heavily in ecological change and will continue to increase the transparency of these investments with its regular issues. We will determine the exact framework for the issue in August.
The Federal Government also plays an active role on this issue in Europe. The Federal Ministry of Finance and the Federal Environment Ministry have implemented a classification system for sustainable activities. The bulky term “taxonomy” hides a sensible and necessary instrument that ensures an EU-wide understanding of the sustainability of economic activities.
This EU taxonomy provides investors with information about which investments are used to finance environmentally sustainable economic activities. It is important to us not only to rely on climate-friendly investment opportunities, but also to exclude nuclear energy from the catalog of sustainable activities and to take social criteria into account. The European Parliament adopted the regulation last week.
Europe as the first climate-neutral continent
This is just the beginning. We will drive further European initiatives. The European Green Deal is already being discussed. It shows how Europe can be made the first climate-neutral continent by 2050. And how it will boost the economy, strengthen competitiveness, improve people’s health and quality of life and protect nature.
Extensive investments are required to implement the European Green Deal. This is a great opportunity for the finance industry. This will be supported by the renewed sustainable finance strategy announced by the EU Commission for the fourth quarter of 2020.
With the European Sustainable Finance Summit planned for September 2020 under the patronage of the Federal Ministry of Finance and the Federal Ministry for the Environment, we want to take a big step into a sustainable, climate-friendly and healthy future together with decision-makers from business and civil society.
We want to develop Germany into a leading location for sustainable finance. Because finance and environmental protection go hand in hand when it comes to our health and that of our children and grandchildren.
More: Damage to ecosystems increases the risk of disease outbreaks – including pandemics. Federal Environment Minister Schulze is now calling for mandatory international protection regulations.